Under Bush, my taxes went down $250 and my health insurance premiums went up $5,000
Mon Jul 20, 2009 at 03:05:07 PM PDT
If you are Republican and you hate an increase in your taxes because they are extracted essentially at gunpoint, wouldn't you also object to an increase in your health care insurance premiums because if you don't pay them you might die? With the Republicans in charge, the private sector health insurance industry took $20 from me for every dollar that the federal government reduced my taxes.
- govs's diary :: ::
The system the Republicans claim that most Americans are satisfied with saw annual private health insurance premiums rise from $7,086 in 2001 to $12,560 in 2008. I had absolutely no control over these price increases and neither did any government agency. Why does this experience not bring the same fury in Republicans that tax increases do? The private marketplace is powerless to control these runaway prices, which, unlike oil, will not fluctuate with supply and demand.
Is it fair to apply the experience of the last seven years, cost wise, to the next seven if nothing is done by the government? I think it is. I will pay about $1,800 more for health coverage each year (but my taxes will not go up). For ease of comparison. I am going to ignore probable adverse changes in my deductibles and co pays. Every employer with group health plans would pay for that increase by either reducing or restricting your pay by that amount or by adjusting your deductible and co pays (or worse, cancel the group plan altogether). Either way, you pay the increase.
Now what happens with a new government plan? If you are an employer with an existing group health plan, your future costs are capped at today's' level. If you are an employer that does not have a group health plan, you will pay about $4000 for each employee that you pay at a median salary, capped in percentage terms for the future.
If you make less than $250,000 per year, you will pay no more in income t taxes than you pay today. If you make between $250,000 and $750,000, your taxes will go up less than $1800 (the amount your health premiums would increase next year without the plan). If you make more than $1 million your taxes will return to the same rate you paid before 2001.
Who are the losers in this plan? Your first reaction might point to employers without a group plan for their employees (probably most often small businesses) but that would not be the case. Remember that the employer gets something for its money- health insurance for its employees. The employer can ask or tell its employees that in exchange for the health insurance the employees will have to pay for all or a portion of the insurance. Wal Mart, of all companies, likes this plan.
Once the finance mechanisms are in place under any government-sponsored plan, the cost drivers in the system can be, well, systemically addressed without regard to the benefit or detriment to the insurance industry's profits.
Republican opposition to this kind of new health plan is not consistient with its claims to be protective of the nation's fianncial health, let alone its physical health. The Republicans have one last chance to avoid the dustbin of history, or as Jimn DeMint might say,their Waterloo.